The question of which pathways regulate the differentiation of the stratified epidermis has been central to epithelial biology. Transcription is one of the most important regulatory mechanisms controlling the stepwise program of epidermal differentiation. Epidermis has been used as an excellent model for studying the process of cellular differentiation because the cells form a stratified structure during development, and each stratum is easily identified by morphology and expression of specific markers. Our research effort have focused in characterizing the regulation and function of Dlx3 homeobox transcription factor, a member of the murine Dlx family, with essential roles in epidermal, osteogenic and placental development. Transgenic temporal and spatial mis-expression of Dlx3 in the pre-differentiated basal layer caused an abnormal skin phenotype, characterized by cessation of proliferation and premature differentiation of the basal cells judged by the upregulation of expression of late differentiation markers such as loricrin and filaggrin. We are assessing the role of Dlx3 in modulating the cell cycle during the epidermal differentiation process using cultured keratinocytes and mouse models with inducible-ectopic expression of Dlx3. Recent results have also indicated that epidermal deletion of the Dlx3 homeodomain transcription factor leads to disruption of the barrier formation and is linked to the development of an inflammatory response characterized by the accumulation of IL-17-producing CD4(+) T, CD8(+) T, and &#947;&#948; T cells in the skin and lymph nodes. The gene expression signature of this conditional mouse model shared features with lesional psoriatic skin, and Dlx3 expression was markedly and selectively decreased in psoriatic skin. Stratification of the epidermis commences during embryonic development and is a process that continues to occur throughout the life of the organism. The process entails the outward movement of the proliferative basal cells that are adjacent to the basement membrane toward the surface of the skin. The stratification is concurrent with a Ca++-dependent differentiation process and the layer-specific expression of structural and enzymatic markers, with the basal proliferative cell differentiating first to a spinous cell, then to a granular cell, to ultimately terminally differentiate as a cornified, anucleated cell. The Ca++ signaling dependent systems, such as keratinocyte differentiation process, must be finely tuned for rapid and effective response to transient variations in Ca++ concentration. Calcium-mediated signals play important roles in epidermal barrier formation, skin homeostasis, and wound repair. Calmodulin 4 (Calm4) is a small, Ca2+ binding protein with strong expression in suprabasal keratinocytes. In mice, Calm4 first appears in the skin at the time of barrier formation and its expression increases in response to epidermal barrier challenges. We characterized the Calm4 knockout mice and show that Calm4 is dispensable for epidermal barrier formation, maintenance, and repair.